The current problem with eminent domain is "cheapness."
One of the powers of government that supersede individual
property rights is eminent domain. When government needs land
for a public use, the government has the legal authority to take
(buy) it. The process is well defined, although the 2005 Supreme
Court Kelo v New Haven decision and recent eminent domain
activity for Columbia University in New York have surely roiled
the waters by bringing private economic development into the game.
Watching the State of Ohio operate recently over takings for road
widening projects, we were struck by how cheap the State was
being. They were doing everything in their power to pay the
property owner as little as possible. While tax payers may
applaud such behavior, it is extremely adversarial to private
property owners' rights and and a forced sale at a low price
is generally unfair and unjust.
Maggie's Farm led me to an interesting essay by James DeLong
on "just compensation." Full essay Here. Excerpt here:
"In the eminent domain context, the problem is that land-
owners are not being paid enough. The standard of “just
compensation” is usually interpreted as the market value of
the property as determined by dueling appraisers. This
standard can be unfair, as Loyola Law School Professor
Gideon Kanner has long argued. It skimps on costs of
relocation and upset, and excludes consideration of damage
to businesses, which can considerably outweigh the value of
the real estate. Tenants, especially businesses, are often
Eminent domain is a fact of life in the real estate world. Just
compensation, which involves more than what two appraisers
agree is the property's fair market value, should be an
integral part of the process. After all, the State is not only
taking the present, but, against an individual's will, they are also
taking the future. Pay up!